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Sunday, October 27, 2013

Practical Advice: 1905 Article on Bidding at Stamp Auctions

W.F. Gregory advised collectors on how to bid at stamp auctions in the February, 1905 issue of "The American Journal of Philately"

Stamp Auctions

Ding-dong! Ding-dong! Vendue! Vendue! Ringing a bell and shouting “vendue” the town crier used formerly to call the public to attend upon sales by public bidding. By this method all sales by order of courts or other public officials were required to be made.
It was also a convenient method of disposing of miscellaneous property expeditiously.

In later years we find the auction-room a popular method of dispersing many kinds of merchandise. The entire product of a large cotton or woolen mill may thus be distributed among the wholesale or jobbing houses of the country.

This method of selling, once synonymous with sacrifice, is now often the arbiter of market prices.

In no line of business has the auction mart become more popular than the stamp trade. The sales of stamps at auction in New York have reached nearly $100,000 in a single season.

Still it is a matter of surprise how few collectors avail themselves of the advantages of buying at auction. And there are not a few who, not understanding the method, have tried unsuccessfully to buy at auction.

The purpose of this paper, then, is to assist those who are, or would be, buyers, by outlining the course of an auction sale and advising them of their rights and obligations.

First, it must be understood that those who conduct sales rarely offer their own goods. Cataloguers of reputation have sufficient consignments to tax their facilities to the utmost.

The first work of the cataloguer is to separate a collection into lots best suited to the convenience of the probable buyer, be he collector or dealer. From a careful collation of these lots results a catalogue which will enable the would-be purchaser to form a pretty accurate idea, with the aid of a standard catalogue, of what stamps constitute each lot.

The condition of these stamps can only be generally described, as there is no fixed standard. Many collectors erect a standard of quality so very extreme that they can only determine by examination personally, or by a special agent, if the stamps offered will suit them.

The average collector, however, may accept the description in the catalogue to mean “marketable,” unless otherwise described.
Probably not ten percent of the best collections of the world are in the condition required by the ultra-extremist. It is, then, hardly reasonable to expect perfection where there is only a possibility of 1 in 10 of its existence.

Having placed this catalogue before the buying public, many bids may be expected by mail. And it is at this point many bidders fail to understand the character of the sale. If a lot of stamps which a bidder wants is catalogued at $10 and he would be quite willing to buy from a dealer at $6, why should he not bid $6 for it and perhaps get it for less if others did not bid on it?
If one makes liberal bids, it does not follow that he will have to pay the limit. It is customary to execute the highest bid at a fair advance over the next higher, at which bid it would be “knocked down” if there is no competitive bidding from the floor. The room bidders must always be reckoned with.

The bidder should always remember that there are perhaps twenty others bidding on the same stamp, some of whom are willing to pay as much as himself. His bid is, therefore, executed at the limit, the first bid received at this figure taking the prize, if the room bidders permit. Those in the room are always at an advantage in the bidding and usually secure the snaps.

The sale having been completed, in compliance with the law, which in this city is very strict, is absolute, and every bidder may be compelled to complete his part of the contract by paying for and taking away his purchases. No man, under the law, may refuse to accept and pay for his purchase, which has been on public view, even if not in accordance with the catalogue.

If he has been wronged, he may seek redress and will be surprised to find how sensitively the law responds. Appeal to the law is needless, however, as the manager of the sale will wish to avoid any unpleasant notoriety, and the auctioneer to protect his license and his bondsmen.

Some bidders, not satisfied with their purchases, seek an excuse by which to avoid their contract, and display a petty meanness of which they are probably quite ignorant. How hard to see ourselves as others see us. They return lots because they are not satisfied and compel the manager to become the purchaser at the prices they have bid. The manager has no redress but to cut off the offender from his lists.

To make low bids is quite proper and hurts no one except the bidder. We have seen strings of 200 or 300 bids on a single sale where the bidder would get two or three lots no one else wanted. If gunning for bargains, reasonable bids on desirable stamps is often very successful. If the stamps are not the ones wanted or not in accordance with the instructions of the bidder, the bids are canceled.

The small commission charged, usually 5 percent, is often saved many times to the bidder by thus employing an agent who has no direct interest in the sale.

To summarize: Study the catalogue, mark those lots you wish to buy, enter a fair price that you are willing to pay for each lot, estimate the amount you wish to expend, and send your bids for about double this amount to an agent with full instructions as to your wants in condition, quantity, etc.

Do not send trifling bids. Do not bid on something you do not want.

And, if you make a mistake, do not try to hold someone else responsible.

Those interested in learning about investing in stamps should read the Guide to Philatelic Investing ($5), available on Kindle and easily accessible from any computer.  

Sunday, October 20, 2013

Stamp Investment Tip: Lebanon 1946 Allied Victory Souvenir Sheets (Scott #C106 Note)

  In 1946, Lebanon issued a set of six airmail stamps (Scott #C101-06) and three souvenir sheets on card stock (Scott #C106 Note) honoring the victory of the Allied Nations in World War II. While the set is fairly common, the souvenir sheets are scarce. 3,757 of the souvenir sheet with sepia inscriptions, 4,138 of the one with blue inscriptions, and 300 of the third, with blue inscriptions and printed on thick, honeycombed chamois card were issued, and Scott '13 prices the first two at $ 30.00 each, and the third at $ 110.-.

   The sheets have dual market appeal to collectors of Lebanon, World War II-related topicals. Also, many of the early issues of the independent nations which were former colonies/possessions of France are of interest to collectors there, as cultural ties remain strong.

Lebanon, a nation of 4.2 million people, is noted for its commercial enterprise. Over the course of time, emigration has yielded Lebanese "commercial networks" throughout the world. As a result, remittances from Lebanese abroad to family members within the country total $8.2 billion and account for one fifth of the country's economy. The country has the largest proportion of skilled labor among Arab States. The tourism and banking sectors are the the most important pillars of the Lebanese economy, though they have at times been disrupted by political instability. Annual GDP growth has averaged about 4.8% over the last 5 years.
The Stamp Auction Bidders and Consignors Union (SABACU) provides a venue for discussing stamp auctions and represents the interests of stamp auction bidders and consignors in their dealings with stamp auctioneers. All stamp collectors and dealers are welcome to join.

Sunday, October 13, 2013

Stamp Investment Tip: Panama 1956 Pan-American Presidents (Scott #C157-80)

  In 1956, Panama celebrated the Pan-American Conference by issuing a set of twenty four airmail stamps portraying Pan-American Presidents (Scott #C157-80). 20,000 sets were issued, and Scott '13 prices the unused set at $ 17.55 . 

As with all Latin American stamps, there are many collectors who focus on the region as a whole, which supplements demand for the stamps of the individual countries. This is particularly true in the case of this set, as its subject further enhances its regional appeal.

A nation of 3.4 million people, Panama is the fastest growing economy and the largest per capita consumer in Central America. Panama's economy, because of its key geographic location, is mainly based on a well developed service sector heavily weighted towards banking, commerce, tourism, trading. The handover of the Canal and military installations by the United States has given rise to large construction projects. Tourism has grown rapidly during the past 5 years due to the government offering tax and price discounts to foreign guests and retirees. The country also has valuable copper and gold deposits, which are beginning to be developed. Annual GDP growth has averaged over 7% over the last 5 years.

I have begun a new blog, "The Stamp Specialist", which will feature my buy prices for stamps which I am interested in purchasing. I've just posted a buy list for Panama, including the set and souvenir sheet recommended in this article. Viewing dealers' buy lists every now and then is an excellent way to keep current on the vagaries of the stamp market.

Thursday, October 10, 2013

Stamp Investment Tip: Malta 1885 Victoria (Scott #8-13)

In 1885, Malta issued a set of six stamps picturing Queen Victoria, with a Crown and CA watermark (Scott #8-13). 60,000 sets were issued, and Scott '13 prices the unused set at $144.00 and the used set at $30.50 .

Though Malta had issued stamps since 1860, this was the first Maltese set to include a high value (1 shilling), to be used on parcels, and it is likely that the vast majority of sets were used as postage and discarded. While demand is certainly greatest for unused sets, given the significant difference between catalog values for the unused and used sets, F-VF or better used sets would seem a bargain as well.

Stamps of Malta are popular among British Commonwealth collectors. The country itself, with a population of about 400,000, has annual GDP growth of about 2.5%, and major industries include limestone extraction, tourism, and financial services. Growing secondary sectors include electronics, pharmaceuticals, and film production. Malta is investing heavily in education, which bodes well for the future.

Those interested in becoming part of an international community of stamp collectors, dealers, and investors are encouraged to join the "Stampselectors" group at Facebook. The group hosts lively discussions concerning stamp investment and practical aspects of collecting, and provides a useful venue for those who wish to buy, sell, or trade stamps. 

Sunday, October 6, 2013

Stamp Investment Tip: Macao 1985 Butterfly Souvenir Sheet (Scott #517a)

   In 1985, Macao issued a souvenir sheet celebrating World Tourism Day, and picturing butterflies (Scott #517a). 30,000 were issued, and Scott '13 prices the unused sheet at $160.- .

   The souvenir sheet appeals to collectors of Animals/Butterflies topicals.

In my opinion, all of the better stamps of the European and other foreign former Colonies/Possessions in China should be considered for investment, as they have dual markets both in their former home countries and in China.

In 1999, Macao became a special administrative district of the People's Republic of China. With a population of about 500,000, Macao's economy is dependent upon tourism, much of it geared toward gambling, although important secondary sectors include apparel manufacturing and financial services. Annual GDP growth has been high, averaging over 9% over the last 7 years. The fact that much of Macao's economic growth has been driven by a regional monopoly on gaming is a little worrisome, because obviously there is no guarantee that the People's Republic won't relax restrictions on gambling in the rest of China, allowing more competition. Nevertheless, I feel that certain scarce issues of this former colony are grossly undervalued, given the number of collectors who will be bidding for them.

Those interested in learning about investing in stamps should read the Guide to Philatelic Investing ($5), available on Kindle and easily accessible from any computer.  

Thursday, October 3, 2013

Stamp Investment Tip: Turkmenistan 1993 Caspian Seal Issue (Scott #34-38, 38a)

  In 1993, Turkmenistan issued a set of 6 stamps honoring the World Wildlife Fund, and picturing Caspian Seals (Scott # 34-38, 38a). 30,000 sets were issued, as well as 5,000 booklets (Scott #38a). Scott '13 prices these unused at $10.15  and $32.50, respectively.

   I recommend purchase of both the set and the booklet, although the booklet is certainly the more alluring of the two from an investment perspective. The stamps picturing these cute aquatic mammals appeal to Animal topicalists and Eco-topicalists. According to the American Topical Association, Animals are the most popular topical subject among stamp collectors, and there are quite a few who specialize in WWF issues.

I believe that focusing on scarce popular topicals is a prudent means of speculating on stamps of the newly independent nations of Central Asia. Whether or not demand develops within these countries for the stamps that they issue, there will always be worldwide demand for their most popular topicals.

A nation of 5.1 million, Turkmenistan is a largely desert country with nomadic cattle raising, intensive agriculture in irrigated oases, and huge gas and oil resources. It possesses the world's fourth largest reserves of natural gas, and is also the world's tenth largest producer of cotton. As in the Soviet era, central planning and state control pervade the system, although there is gradual progress toward greater privatization. Annual GDP growth has averaged over 8% over the last 5 years, mostly due to increasing demand for the country's oil.
 The Stamp Auction Bidders and Consignors Union (SABACU)  serves as  a forum for discussing stamp auctions and also represents the interests of stamp auction bidders and consignors. All stamp collectors and stamp dealers are welcome to join.